Although it's far from a surprise and has long been predicted, it's finally a reality: Social Security is now officially paying out more than it is taking in.

Of course, Social Security has taken in more than it has paid out pretty much since its inception...which would lead a normal person to think there's a big fat piggy bank just waiting to pay out all those benefits, right? Wrong. The truth is that the government has faithfully borrowed every dime of that surplus over the years and spent it on, well, everything.

Bruce Krasting looks at the public data on the Social Security "Trust Fund" and points out that the numbers are headed in the wrong direction...pointing out that this wasn't expected to happen for another five years or so.

This is the cost of the protracted recession and the failure of the
economy to generate new jobs. The 2008-2009 increase in benefits was at
a nosebleed level of 9.5%. That level has collapsed to 3.9% in the
2009-2010 period. ...

As pretty much anyone and everyone who's paid any attention to the news for the past generation knows, Social Security, as it is currently configured, is going to run out of money. It's simple math. But it has always (to a great many people) seemed like a distant prospect, not something that demanded to be dealt with right now.

For decades and decades, the program has muddled along, with a few tweaks here and there, running a surplus of funds paid it by workers versus benefits paid to retirees. And, of course, the federal government "borrowed" those surpluses from the Social Security fund and spent them on just about everything else under the sun. Which means there has been an ever growing IOU in the "trust fund". Couple this with the beginning retirements of baby boomers, and many people have pointed out that it's going to be a problem sooner rather than later.

Margaret Thatcher once said that the problem with socialism is that you eventually run out of other people's money. And considering that liberalism is essentially socialism, the same principle applies. And with that said, America is fast running out of other people's money.

There was a great op-ed in the Washington Examiner last week which suggested that our national debt, the result of borrowing other people's money over the years, would be the end of liberalism as there would no longer be enough money to pay for it. To which one could conclude that, if there's anything silver lining to the explosive growth of government, entitlement programs, etc. - to say nothing of what Obama and current members of Congress have in mind - it's that they'll just bankrupt us quicker and bring a more speedy end to liberalism.

After almost a year of big, new spending proposals - to say nothing of the tab that will come along with government run health care - the White House is signaling that this year's one and a half trillion dollar deficit might be a political problem that needs to be dealt with after all.

It's a good bet that what this really represents is their recognition of what's happening in elections in Virginia, New Jersey and New York - and their trying to inoculate themselves against similar political damage in the future.

Anxiety about the deficit has fueled the anger of the conservative "tea party" activists, riled by government spending and debt, and it has seeded reservations about the long-term price tags of signature items on the president's agenda...

A speech last week by Christina D. Romer, chairman of the president's Council of Economic Advisers, looked at the reasons for the deficit and at how it relates to health care reform. Treasury Secretary Timothy F. Geithner appeared on NBC's "Meet the Press" on Sunday to make clear that the administration recognizes the deficit is growing too large.

"Well, it's going to have to come down. Now it's too high, and I think everybody understands this," Mr. Geithner said. "The president's very committed to bring down these deficits."

A tax-policy expert says instead of trimming spending and balancing the budget, Congress is poised to agree to the Obama administration's request to raise the federal debt limit again.

Treasury Secretary Tim Geithner pleaded with Congress on Friday to increase the $12.1 trillion federal debt ceiling. In a letter to lawmakers, Geithner wrote: "It is critically important that Congress act before the limit is reached so that citizens and investors here and around the world can remain confident that the United States will always meet its obligations."

Chris Edwards, director of tax policy at the Cato Institute, says the federal debt, which was about $8 trillion in 2005, will jump to about $19 trillion by 2015 under the Obama administration's plan...

Washington -- U.S. Treasury Secretary Timothy Geithner asked Congress to increase the $12.1 trillion debt limit on Friday, saying it is "critically important" that they act in the next two months.

Mr. Geithner, in a letter to U.S. lawmakers, said that the Treasury projects that the current debt limit could be reached as early mid-October. Increasing the limit is important to instilling confidence in global investors, Mr. Geithner said.